CFA Level I · CFA Level I Exam · Equity Jurisdictions, Classes, and the Voting Process
A shareholder cannot attend the annual general meeting and appoints another person to vote on her behalf according to her written instructions. This arrangement is best described as:
This is proxy voting. A shareholder who cannot attend delegates her voting rights to another person, who casts the votes as instructed. It differs from cumulative voting, which is a method of allocating votes across board seats rather than a delegation mechanism.
- Aproxy votingCorrect
- Bcumulative voting
- Ca written consent solicitation by the board
Explanation
Proxy voting lets a shareholder authorize another party to vote on her behalf, often with specific instructions. Cumulative voting concerns how votes are allocated among director seats, not who casts them.
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